Error in .htaccess under assets directory in v2.3.2 RC2

I have been trying out the latest release candidate and I receive the following error in the Apache log files when accessing an image in the assets directory:
Invalid command 'php_flag', perhaps mis-spelled or defined by a module not included in the server configuration, referer: http://www.domain.com/silverstripe/gallery/

The code in the .htaccess file reads:
php_flag engine off

To overcome this issue, I renamed the .htaccess file. Has anyone else experienced this issue?